**Exhibit 10.4**

**LINN ENERGY, LLCLONG-TERM INCENTIVE PLANFORM OF EXECUTIVE OPTION AGREEMENT**

This option agreement (“*Option Agreement*”) is made and entered into effective asof [Grant Date], (the “*Grant Date*”)by and between LINN ENERGY, LLC, a Delaware limited liability company (togetherwith its subsidiaries, the “*Company*”),and [Executive] (“*Participant*”).

*WHEREAS*, the Company considers itto be in its best interest that Participant be given a proprietary interest inthe Company and an added incentive to advance the interests of the Company; and

*WHEREAS*, the Company desires toaccomplish such objectives by affording Participant an option to purchase Unitspursuant to the Linn Energy, LLC Long-Term Incentive Plan, which is attachedhereto as Appendix A and incorporated by reference herein (the “*Plan*”). Unless otherwise definedherein, capitalized terms shall have the meaning given such terns in the Plan.

**NOW, THEREFORE**, in consideration ofthe mutual agreements hereinafter set forth, the parties hereby agree asfollows:

# 1.             **Grant of Option**.  The Company hereby grants to Participant anoption (the “Option”)to purchase all or any part of an aggregate of [________] Units, under andsubject to the terms and conditions of this Option Agreement and the Plan.

# 2.             **Purchase Price**.  The purchase price for each Unit to bepurchased hereunder shall be $ [______] (the “Exercise Price”).

# 3.             **Vesting and Option Period**.  Participant may exercise the Option in wholeor in part.  Except as otherwise providedherein, the Option shall become vested and exercisable with respect to onethird (1/3) of the covered Units on the first anniversary of the Grant Date,with respect to an additional one third (1/3) of the covered Units on thesecond anniversary of the Grant Date and with respect to the final one third(1/3) of the covered Units on the third anniversary of the Grant Date.  Prior to such time, no portion of the Optionshall be exercisable unless its exercisability is accelerated as provided inthis Option Agreement or the Plan. Except as provided otherwise in this Option Agreement or the Plan, theOption, to the extent not theretofore exercised, shall terminate on theexpiration of ten (10) years from the date of grant of the Option; provided,however, that upon the termination Participant’s service relationship with theCompany for any reason other than (a) the death of the Participant or (b)termination of the Participant’s service relationship with the Company as aresult of a Change of Control, Participant may, until the earlier of (i) 90days from the date of such termination or (ii) the expiration of the Option inaccordance with this Section 3, exercise the Option, to the extent such Optionhad vested immediately prior to such termination and, thereafter, the Optionshall, to the extent not previously exercised, automatically terminate andbecome null and void.

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# 4.             **Method of Exercise andPayment**.  To the extent thatthe Option has become exercisable, the Option may be exercised from time totime by written notice to General Counsel, in substantially the form attachedhereto as Appendix B or such other form as may be approved from time to time bythe Committee, accompanied by the aggregate Exercise Price for the Units to bepurchased and any required tax withholding amount as may be determined in thediscretion of General Counsel.  TheExercise Price and any withholding shall be payable in cash, by certifiedcheck, by bank check or other means provided for in the Plan and approved by theCommittee, including without limitation by cashless-broker exercise or thewithholding of Units upon the exercise of the Option.

# 5.             **General Restrictions**.  Subject to the terms of this Option Agreementand the Plan, the Option may be exercised at any time, and from time to time,in whole or in part, until the termination thereof as set forth herein, oruntil all Units covered by the Option shall have been purchased, whicheverfirst occurs.  The Option shall not beassignable or transferable except as expressly provided by the Committee.

# 6.             **Termination by Companyother than for Cause**.  Upon the termination by the Company ofParticipant’s service relationship with the Company other than for Cause (asdefined herein and as determined by the Committee in its sole discretion), theOption granted hereby shall automatically and immediately vest in full.  “Cause” shall mean (a) Participant’s conviction of, or pleaof nolo contendere to, anyfelony, any crime or offense causing substantial harm to the Company (whetheror not for personal gain) or involving acts of theft, fraud, embezzlement,moral turpitude or similar conduct; (b) Participant’s repeated intoxication byalcohol or drugs during the performance of his or her duties; (c) malfeasancein the conduct of Participant’s duties, including, but not limited to, (i)willful and intentional misuse or diversion of any Company funds, (ii)embezzlement or (iii) fraudulent or willful and material misrepresentations orconcealments on any written reports submitted to the Company; (d) Participant’smaterial failure to perform the duties of Participant’s employment or servicerelationship consistent with Participant’s position or material failure tofollow or comply with the reasonable and lawful written directives of the Boardof the Company; or (e) a material breach by Participant of the written policiesof the Company concerning employee discrimination or harassment.

# 7.             **Termination byParticipant with Good Reason**.  Upon the termination by Participant ofParticipant’s service relationship with the Company with Good Reason (asdefined herein), the Option granted hereby shall automatically and immediatelyvest in full.  “Good Reason” shall mean any ofthe following to which Participant does not consent in writing: (a) a reductionin Participant’s base salary; (b) a relocation of Participant’s primary placeof employment to a location more than 50 miles from [Houston,Texas]/[Pittsburgh, Pennsylvania]; or (c) any material reduction in Participant’stitle, authority or responsibilities as [Title] of the Company.

# 8.             **Death or Disability**. In the case of termination of Participant’s service relationship withthe Company due to death or Disability (as defined herein), the Option grantedhereby shall automatically and immediately vest in full.  “Disability” shall mean the determination by a physicianselected by the Company that Participant has been unable to performsubstantially Participant’s usual and customary duties for a period of at leastone

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# hundred twenty (120) consecutive days or anon-consecutive period of one hundred eighty (180) days during any twelve-monthperiod as a result of incapacity due to mental or physical illness ordisease.  In the case of termination ofParticipant’s service relationship with the Company due to death or Disability,Participant or Participant’s estate (or any person who acquired the right toexercise such Option by bequest or inheritance or otherwise by reason ofParticipant’s death or by reason of Participant’s Disability) may, until theearlier of (a) one year after the date of death or (b) the expiration of theOption in accordance with Section 3, exercise the Option and, thereafter, theOption shall, to the extent not previously exercised, automatically terminateand become null and void.

# 9.             **Change of  Control**.  Notwithstanding anythingin the Plan to the contrary, in the event of a Change of Control (as defined inthe Employment Agreement), the Option granted hereby shall automatically andimmediately vest in full.  In the eventof the termination of Participant’s service relationship with the Company as aresult of a Change of Control, the Participant may, until the earlier of (a)one year after the date of such termination or (b) the expiration of the Optionin accordance with Section 3, exercise the Option and, thereafter, the Optionshall, to the extent not previously exercised, automatically terminate andbecome null and void.

# 10.           **Terminationby Company for Cause or by Participant without Good Reason**. In the case of (a) termination by the Company of Participant’s servicerelationship with the Company for Cause or (b) termination by Participant ofParticipant’s service relationship with the Company without Good Reason andother than due to Participant’s death or disability, Participant shallimmediately forfeit all rights with respect to any unvested Options..  Participant hereby agrees to undertake anyaction and execute any document, instrument or papers reasonably requested bythe Company to effect such forfeiture of the Option resulting from any suchtermination.

# 11.           **Rights as a Unitholder**.  Participant, or a transferee of the Option,shall have no rights as a holder of a membership interest in the Company exceptas to any Units actually purchased pursuant to the exercise of the Option.

# 12.           **Plan Controlling Document**.  Participant agrees that the Plan is thecontrolling instrument and that to the extent there is any conflict between theterms of the Plan and this Option Agreement, the Plan shall control and be thegoverning document.

# 13.           **Limited Liability CompanyAgreement**.  As a condition tothe exercise of the Option, Participant agrees to be bound by all applicableprovisions of the Company’s limited liability company agreement, as it may beamended from time to time.

# 14.           **Taxes**.  The Company and any affiliate thereof areauthorized to withhold from any payment relating to the Option, or any payrollor other payment to Participant, amounts of withholding and other taxes due orpotentially payable in connection with the exercise of the Option, and to takesuch other action as the Committee may deem advisable to enable the Company,any affiliate, and Participant to satisfy obligations for the payment ofwithholding taxes and other tax obligations relating to the Option.  This authority shall include authority towithhold or receive Units or other property and to make cash payments inrespect thereof in

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# satisfaction of Participant’s tax obligations, eitheron a mandatory or elective basis in the discretion of the Committee.

# 15.           **Issuance of Units**.  The Company shall not be obligated to issueany Units pursuant to the Option at any time when the Units covered by suchOption have not been registered under the Securities Act of 1933, as amended,and such other state and federal laws, rules or regulations as the Company orthe Committee deems applicable and, in the opinion of legal counsel for theCompany, there is no exemption from the registration requirements of such laws,rules or regulations available for the issuance and sale of such Units.

# 16.           **Notices**.  Any notices given in connection with thisOption Agreement shall, if issued to Participant, be delivered to Participant’scurrent address on file with the Company, or if issued to the Company, bedelivered to the Company’s principal offices.

# 17.           **Execution of Receipts andReleases**.  Any payment of cashor any issuance or transfer of Units or other property to Participant, or toParticipant’s legal representatives, heirs, legatees or distributees, inaccordance with the provisions hereof, shall, to the extent thereof, be in fullsatisfaction of all claims of such persons hereunder.  The Company may require Participant orParticipant’s legal representatives, heirs, legatees or distributees, as acondition precedent to such payment or issuance, to execute a release andreceipt therefor in such form as it shall determine.

# 18.           **Successors**.  This Option Agreement shall be binding uponParticipant, Participant’s legal representatives, heirs, legatees anddistributees, and upon the Company, its successors and assigns.

*[Remainder of this Page Intentionally Left Blank]*

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**IN WITNESS WHEREOF**,the parties hereto have executed this Option Agreement to be effective as ofthe day and year first above written.
|            | **LINN ENERGY, LLC** |                  |
|------------|----------------------|-----------------------|
| ** ** | ** **           |                  |   |
| ** ** | ** **           |                  |   |
|       | By:                  |                  |   |
|       | Name:                | [___________________] |   |
|       | Title:               | [___________________] |   |
| ** ** | ** **           |                  |   |
| ** ** | ** **           |                  |   |
| ** ** | **PARTICIPANT:**     |                  |
| ** ** |                 |                  |
| ** ** |                 |                  |

 

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**APPENDIXA**

**LINNENERGY, LLC**

**LONG-TERMINCENTIVE PLAN**

**(EFFECTIVEAS OF JANUARY 12, 2006)**

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**APPENDIXB**

**LINNENERGY, LLCLONG-TERM INCENTIVE PLANOPTION EXERCISE NOTICE**

PLEASE PRINT:
| TODAY’S DATE: |   |
|--------------------|--------|
| OPTIONHOLDER NAME: |   |
| MAILING ADDRESS:   |   |
|               |   |
|                    |        |  |  |

 

Attention:              General Counsel

I hereby exercise my Option to acquire __________Units, as defined in the LINN ENERGY, LLC Long-Term Incentive Plan (the “Plan”),at my exercise price per Unit of $_____________.  In accordance with the Plan and the GrantAgreement, the Board has approved payment of the Option Exercise Price (and anyapplicable withholding) by the following methods, and I hereby elect to makepayment for the Units being purchased as indicated:

o                                    **Cash or check in immediately available funds**

o                                    **Cashless Exercise pursuant to established Companyprocedure**

o                                    **Withholding of Units pursuant to established Companyprocedure**

I hereby represent that Ihave previously received a copy of the Plan from the Company and that Iunderstand the terms and restrictions described therein and agree to be boundby the terms of such document and my Option Agreement.
| By:                                       |   |
|-----------------------------------------------------|--------|
|                                                |
|                                                |
| Receipt of Notice and Payment in Full Acknowledged: |
|                                                |   |   |
|                                                |   |   |
| By:                                                 |   |   |
|                                                |   |   |
| Name:                                               |   |   |
|                                                |   |   |
| Date:                                               |   |   |
|                                                     |        |  |  |  |  |  |

 

**NOTE:  Ifexercising the Option represented by the enclosed Option Agreement to purchaseless than all of the Units to which the Option relates, the original Option**

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**Agreement will be returned with an appropriatenotation evidencing the Units for which the Option has been exercised.**

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